The Federal Reserve fights recession via open market operations,the supply of reserves curve shifts ________ and the supply of money curve shifts ________.

Question

Quizplus · Accepted Answer

The Federal Reserve fights recession by increasing the money supply through open market operations, which involves buying government securities. This action shifts the supply of reserves curve rightward, increasing the reserves in the banking system, and also shifts the supply of money curve rightward, increasing the overall money supply.

The Federal Reserve Fights Recession Via Open Market Operations,the Supply